Tesla founder, Elon Musk, is working on a self-driving vehicle that could replace buses.

The billionaire says the mystery vehicle will reduce traffic in cities, but declined to discuss any more details.

'We have an idea for something which is not exactly a bus but would solve the density problem for inner city situations,' Musk said at a transport conference in Norway.

Scroll down for video

Tesla founder, Elon Musk, is working on a self-driving vehicle that could replace buses. 'We have an idea for something which is not exactly a bus but would solve the density problem for inner city situations,' Musk said at a transport conference in Norway

'Autonomous vehicles are key,' he said of the project, declining to reveal more.

'I don't want to talk too much about it. I have to be careful what I say.'